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Cousins Properties’ (CUZ - Free Report) second-quarter 2023 funds from operations (FFO) per share of 68 cents beat the Zacks Consensus Estimate of 66 cents. However, the figure declined from the prior-year quarter’s 70 cents.
Results reflect better-than-anticipated revenues, supported by healthy leasing activity and improvement in second-generation net rent per square foot. Yet, higher same-property rental property operating expenses acted as a dampener. The company also revised its 2023 FFO per share outlook.
Quarterly rental property revenues came in at $204 million, surpassing the Zacks Consensus Estimate of $202.3 million. Moreover, the figure increased 11.3% year over year.
Quarter in Detail
Cousins Properties executed leases for 435,492 square feet of office space in the second quarter, including 343,167 square feet of new and expansion leases. This marked 78.8% of total leasing activity.
The same-property rental property revenues, on a cash basis, rose 4.5% year over year to $177.9 million. The same-property rental property operating expenses on a cash basis increased 6% to $64 million in the second quarter of 2023. As a result, the same-property net operating income, on a cash basis, climbed 3.7% to $113.9 million from the prior-year period.
The weighted average occupancy of the same-property portfolio was 87.3%, which remained the same as of Jun 30, 2022. Our estimate for the same was 87.1%.
CUZ ended the quarter with the same-property portfolio being leased 90.5%, up from 90% recorded at the end of the year-ago period.
The second-generation net rent per square foot (cash basis) climbed 7.9%.
Balance Sheet
CUZ exited second-quarter 2023 with cash and cash equivalents of $8 million, up from $3.6 million as of Mar 31, 2023.
The company’s net debt-to-annualized EBITDAre ratio in the quarter was 4.89 compared with 4.93 in the year-ago quarter.
2023 Outlook Revised
Cousins Properties revised its guidance for 2023 FFO per share.
It expects the same to be in the range of $2.57-$2.65, up from the prior guided range of $2.55-$2.65. The Zacks Consensus Estimate for the same is currently pegged at $2.60, which lies within the guided range.
CUZ currently carries a Zacks Rank #3 (Hold).
Cousins Properties Incorporated Price, Consensus and EPS Surprise
We are looking forward to the earnings releases of other REITs like SBA Communications (SBAC - Free Report) and Host Hotels & Resorts (HST - Free Report) , which are slated to report their results on Jul 31 and Aug 3, respectively.
The Zacks Consensus Estimate for Host Hotels & Resorts’ second-quarter 2023 FFO per share is pegged at 56 cents, implying a year-over-year decrease of 3.5%. HST currently carries a Zacks Rank #3.
Note: Anything related to earnings presented in this write-up represents FFO — a widely used metric to gauge the performance of REITs.
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Cousins Properties (CUZ) Q2 FFO & Revenues Beat Estimates
Cousins Properties’ (CUZ - Free Report) second-quarter 2023 funds from operations (FFO) per share of 68 cents beat the Zacks Consensus Estimate of 66 cents. However, the figure declined from the prior-year quarter’s 70 cents.
Results reflect better-than-anticipated revenues, supported by healthy leasing activity and improvement in second-generation net rent per square foot. Yet, higher same-property rental property operating expenses acted as a dampener. The company also revised its 2023 FFO per share outlook.
Quarterly rental property revenues came in at $204 million, surpassing the Zacks Consensus Estimate of $202.3 million. Moreover, the figure increased 11.3% year over year.
Quarter in Detail
Cousins Properties executed leases for 435,492 square feet of office space in the second quarter, including 343,167 square feet of new and expansion leases. This marked 78.8% of total leasing activity.
The same-property rental property revenues, on a cash basis, rose 4.5% year over year to $177.9 million. The same-property rental property operating expenses on a cash basis increased 6% to $64 million in the second quarter of 2023. As a result, the same-property net operating income, on a cash basis, climbed 3.7% to $113.9 million from the prior-year period.
The weighted average occupancy of the same-property portfolio was 87.3%, which remained the same as of Jun 30, 2022. Our estimate for the same was 87.1%.
CUZ ended the quarter with the same-property portfolio being leased 90.5%, up from 90% recorded at the end of the year-ago period.
The second-generation net rent per square foot (cash basis) climbed 7.9%.
Balance Sheet
CUZ exited second-quarter 2023 with cash and cash equivalents of $8 million, up from $3.6 million as of Mar 31, 2023.
The company’s net debt-to-annualized EBITDAre ratio in the quarter was 4.89 compared with 4.93 in the year-ago quarter.
2023 Outlook Revised
Cousins Properties revised its guidance for 2023 FFO per share.
It expects the same to be in the range of $2.57-$2.65, up from the prior guided range of $2.55-$2.65. The Zacks Consensus Estimate for the same is currently pegged at $2.60, which lies within the guided range.
CUZ currently carries a Zacks Rank #3 (Hold).
Cousins Properties Incorporated Price, Consensus and EPS Surprise
Cousins Properties Incorporated price-consensus-eps-surprise-chart | Cousins Properties Incorporated Quote
Upcoming Earnings Releases
We are looking forward to the earnings releases of other REITs like SBA Communications (SBAC - Free Report) and Host Hotels & Resorts (HST - Free Report) , which are slated to report their results on Jul 31 and Aug 3, respectively.
The Zacks Consensus Estimate for SBA Communications’ second-quarter 2023 FFO per share is pegged at $3.14, suggesting year-over-year growth of 2.3%. SBAC currently carries a Zacks Rank #3. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
The Zacks Consensus Estimate for Host Hotels & Resorts’ second-quarter 2023 FFO per share is pegged at 56 cents, implying a year-over-year decrease of 3.5%. HST currently carries a Zacks Rank #3.
Note: Anything related to earnings presented in this write-up represents FFO — a widely used metric to gauge the performance of REITs.